Microsoft is buying LinkedIn and it is all about Office

Microsoft announced today that it is buying LinkedIn for $26.2 Billion in cash, which translates to $196 per share and a healthy premium of 49% on the value of LinkedIn shares. Which is a great deal if you're a LinkedIn shareholder. However for the rest of us mortals, this acquisition couldn't be more confusing, thankfully we've got the CEO of Microsoft Nadella to explain it to us.

We are in pursuit of a common mission centered on empowering people and organizations. Along with the new growth in our Office 365 commercial and Dynamics businesses this deal is key to our bold ambition to reinvent productivity and business processes. Think about it: How people find jobs, build skills, sell, market and get work done and ultimately find success requires a connected professional world. It requires a vibrant network that brings together a professional's information in LinkedIn's public network with the information in Office 365 and Dynamics. This combination will make it possible for new experiences such as a LinkedIn newsfeed that serves up articles based on the project you are working on and Office suggesting an expert to connect with via LinkedIn to help with a task you're trying to complete. As these experiences get more intelligent and delightful, the LinkedIn and Office 365 engagement will grow. And in turn, new opportunities will be created for monetization through individual and organization subscriptions and targeted advertising.

At the end of the day, it's all about making Microsoft's Cash cow Office better for its users. I do hope their LinkedIn purchase works out better for Microsoft than Skype or Nokia.